Tim Steiner sets departure timetable as Ocado looks to reignite US growth
Subscribe to our free newsletter today to keep up to date with the latest retail news.
Ocado has entered one of the most significant periods in its history after co-founder Tim Steiner confirmed he will step down as chief executive at the beginning of the company’s 2028 financial year. After more than 25 years at the helm, Steiner will transition into a founder advisory role through 2029, giving the board time to appoint a successor while ensuring continuity during a pivotal stage of the business’s development.
The announcement provides long awaited clarity over succession planning but also places renewed attention on the challenge facing Ocado. Once viewed primarily as an online grocery retailer, the business has spent more than a decade repositioning itself as a global provider of warehouse automation, robotics and software for grocery retailers. The success of that strategy now depends less on its UK retail operation and more on proving its technology can deliver profitable, long term growth in international markets, particularly North America.
North America remains the biggest opportunity
Ocado’s technology business has attracted some of the world’s largest grocery retailers over the past decade. Its most prominent partnership remains with Kroger in the United States, which agreed in 2018 to deploy Ocado’s automated customer fulfilment centres across its network. The facilities combine robotics, artificial intelligence and software to process thousands of grocery orders with minimal human intervention, promising greater efficiency and improved customer service.
In Canada, Sobeys owner Empire Company also adopted Ocado’s fulfilment technology, reinforcing confidence that the company’s automated platform could be exported successfully beyond the UK.
At the time, these agreements were regarded as a major breakthrough. They demonstrated that retailers in two of the world’s largest grocery markets were prepared to invest heavily in automated fulfilment to support the rapid growth of ecommerce.
The environment has changed considerably since those early announcements. The exceptional demand experienced during the pandemic has eased as shopping habits normalised, prompting retailers to reassess major capital investment programmes. Several automated fulfilment centres in North America have either been closed or scaled back while grocery operators review the pace and scale of future expansion.
Although Kroger continues to operate multiple Ocado powered facilities and both companies continue to describe their relationship positively, investors have become increasingly cautious about how quickly additional sites will be commissioned.
That shift changes the challenge facing Ocado’s leadership. Rather than securing headline grabbing contracts, the company must now demonstrate that existing installations consistently generate value for retail partners while delivering stronger financial returns for shareholders.
Financial discipline takes centre stage
Despite investor concerns surrounding international expansion, Ocado has made meaningful progress in improving its financial performance.
For the 2025 financial year, group revenue increased by more than 12 percent to approximately $1.8 billion, while adjusted EBITDA rose significantly compared with the previous year. The business also returned to statutory profitability, although accounting adjustments contributed to part of that improvement.
Perhaps more importantly, management has increasingly focused on cash generation and operational efficiency after years in which growth was often prioritised over profitability.
Earlier this year, Ocado announced plans to reduce its workforce by around 1,000 roles as part of a broader cost reduction programme designed to support sustainable positive cash flow. The move reflected a wider shift in priorities across the technology sector, where investors have become more focused on earnings quality and cash generation than rapid expansion alone.
The market has welcomed signs of stronger financial discipline, although Ocado’s share price remains under pressure. The stock has fallen by almost a quarter since the start of the year, reflecting ongoing uncertainty over future licensing growth and the pace at which international customers will continue investing in automated fulfilment infrastructure.
Those concerns underline why Steiner’s planned departure carries particular significance. His role has extended well beyond day to day management. As co-founder, he has become the public face of Ocado’s technology proposition, spending years convincing global retailers that warehouse automation represents the future of grocery ecommerce.
His relationships with major retail executives have often proved as valuable as the technology itself.
Reports that some shareholders favoured a slower leadership transition illustrate the importance many investors continue to place on Steiner’s experience and industry credibility. By remaining in position until early 2028 before moving into an advisory role, Ocado aims to preserve stability while allowing an orderly succession process.
A defining test for Ocado’s future
Steiner’s successor will inherit a business that looks very different from the one he helped establish more than two decades ago.
The UK retail operation continues to perform strongly through its joint venture with Marks & Spencer, but the company’s long term valuation increasingly depends on its ability to commercialise its proprietary technology platform around the world.
That means delivering stronger returns from existing customer fulfilment centres rather than relying solely on signing new contracts. Success within Kroger’s network could become one of the most influential factors in determining whether additional North American retailers commit to Ocado’s platform.
The competitive landscape has also evolved. Walmart continues investing heavily in proprietary automation systems while Amazon is expanding its grocery logistics capabilities through Whole Foods Market and Amazon Fresh. Traditional supermarket operators are also developing more sophisticated in house fulfilment technology, reducing reliance on external providers.
Ocado has responded by broadening its commercial strategy. Instead of relying exclusively on large scale partnerships, it has begun offering elements of its technology more flexibly, opening opportunities to work with additional retailers that may previously have been excluded by contractual arrangements.
This approach could allow the company to reach a wider customer base while generating recurring software and service revenues without requiring the same level of capital investment associated with large automated warehouses.
The next 18 months therefore represent a crucial period for the business. Steiner has an opportunity to strengthen investor confidence by improving operational performance, demonstrating stronger cash generation and proving that existing automation projects can produce attractive long term returns for retail customers.
His departure also represents the closing chapter of one of the UK’s most ambitious technology entrepreneurs. Under his leadership, Ocado evolved from a niche online supermarket into an internationally recognised developer of robotics, software and warehouse automation systems that now support grocery retailers across multiple continents.
Whether the company can build on that foundation without its long serving founder will become one of the defining questions for investors. The leadership transition has been carefully planned, but ultimately the next chief executive will be judged not on Ocado’s technological innovation alone, but on the company’s ability to convert years of investment into consistent, profitable international growth.
For Ocado, and particularly for its ambitions in North America, that journey is only just entering its next phase.
Source:
